Standing Committee A

[Frank Cook in the Chair]

National Lottery Bill

Frank Cook: Before I call the Minister to move the programme motion, in view of the oppressive nature of the atmosphere, let me say that I am disposed to allow Members and attendant staff to divest themselves of their upper garments—male Members, that is. Well, I allow female Members to do so, too, as long as they do not go too far.

Richard Caborn: I beg to move,
That— 
(1) during proceedings on the National Lottery Bill, in addition to its first meeting on Tuesday 25th October at 10.30 am, the Standing Committee shall meet on Tuesday 25th October at 4.00 pm, Thursday 27th October at 9.30 am and 1.00 pm, Tuesday 1st November at 10.30 am and 4.00 pm and Thursday 3rd November at 9.30 am and 1.00 pm; 
(2) the proceedings shall be taken in the order shown below and shall (so far as not previously concluded) be brought to a conclusion at 5.00 pm on Thursday 3rd November: Clause 7; Clause 19; Clause 13; Schedule 2; Clause 14; Clauses 8 to 12; Clauses 15 to 18; Clause 20; Schedule 3; Clauses 21 to 23; Clauses 1 to 6; Schedule 1; remaining proceedings on the Bill. 
I thought for a moment that we were going for ''The Full Monty'', Mr. Cook. I welcome you—and your colleague, Mr. Gale—to the Chair. I have no doubt that your chairmanship of our deliberations will, as usual, be fair, impartial and above all productive. I do not doubt that our proceedings will be punctuated by your north-east wit . They say that flattery gets you everywhere. 
The programme motion was agreed by the Programming Sub-Committee. I thank Committee members for agreeing to bring proceedings to an early conclusion next Tuesday to accommodate the fact that I have to go to Cardiff for the sports cabinet, which is an important meeting. I welcome Committee members, some of whose faces I recognise from the Committee that met but a few days ago to consider the London Olympics Bill. Indeed, one Committee member said that he was spending more time with fellow members of Committee than with his own wife. However, there are some new Members here, too. I hope that this Committee is as productive as that which considered the London Olympics Bill, but there will probably be slightly more dissention on this Bill. 
I welcome the hon. Member for East Devon (Mr. Swire), who spoke quite eloquently on Second Reading back in the summer. I have no doubt that he will bring up in Committee some of the issues that he mentioned then. The hon. Member for Bath (Mr. Foster) also spoke on Second Reading. I am sure that we will reflect on some of his amendments and that we will have some good debates on the points of principle that he raised then. 
Some time has passed since Second Reading, which took place in June, so I remind the Committee that the Bill is designed to take the lottery forward along what we can call its evolutionary path. We can all be very proud of the fact that we run one of the best lotteries in the world—if not the best. That statement has been endorsed many times over by people are voting with their feet and continuing to play the lottery in their millions every week. That shows that it is a good product—one that is in tune with the British people. The consultation is important in that respect, too. 
The Bill will open up the lottery to the people—that is at the centre of the Bill, but that is for later—by giving them a say in the lottery. I think that the Bill will make sure that the lottery goes from strength to strength, and I look forward to debating the finer points of the Bill in the coming eight sittings.

Hugo Swire: Mr. Cook, may I thank you in advance for your chairmanship of the Committee? You said earlier that the atmosphere in here is oppressive; I hope that that was a meteorological term rather than an emotional one, because I see no reason why the atmosphere over the next couple of weeks should be oppressive: it will be confrontational at times, I hope, because we fundamentally disagree with almost every aspect of the Bill, but it will certainly not be oppressive.
I am delighted to serve under your chairmanship, Mr. Cook, having served with you on the Speaker's Advisory Committee on Works of Art—perhaps a more esoteric Committee than this one, but as important in its own way. I know you for your judgment and fairness, and I am sure that you will indulge me. Although I have spoken on various Committees, I have never headed up for Her Majesty's Official Opposition before. If I start to flounder, I am sure that you will intervene and save me from embarrassment, because at times trying to follow the rationale behind the amendments to the Bill is like trying to follow ''EastEnders'' after missing six episodes. It does not really matter that I missed them, because I catch up after a bit—

Richard Caborn: Five minutes.

Hugo Swire: The Minister is clearly a greater student of these matters than I, clearly.

Frank Cook: Order. Programming, please.

Hugo Swire: Exactly what I was going to return to, Mr. Cook. We had a meeting last night, and we are happy with the programme motion outlined by the Minister. We are delighted to release him for his other commitments—getting to the sports cabinet on Tuesday night. I was not aware of that, but it sounds very energetic and I am sure that the Minister ought to get there.
The Minister said that he has been running this morning, and we hope to keep him running during the next couple of week weeks. He has been running from the London Olympics Bill and although these proceedings might run at a slightly slower pace, the National Lottery Bill is a serious Bill, with its own part to play. Without further ado, I accede to all the  Minister's requests and I look forward to serving under your chairmanship, Mr. Cook.

Don Foster: Mr. Cook, I welcome you and your co-Chairman, Mr. Gale, to our deliberations. Just before we began our proceedings, the hon. Member for South-West Bedfordshire (Andrew Selous) reminded me that on Committees such as this, I have from time to time—whenever I have been mildly successful in persuading Ministers to accept or at least consider amendments that I tabled—sent a letter to Mrs. Foster. She has got off to a very bad start on this Committee. The Minister has already blown the gaff by saying that I spend more time with him discussing these matters than I do with Mrs. Foster; she will certainly be very upset by that. She will be even more upset by the fact that in his opening remarks, the Minister said that the hon. Member for East Devon spoke eloquently on Second Reading but said merely that I spoke on Second Reading. Mrs. Foster will be deeply upset, but I shall not send her even a postcard on the subject.
We are debating the programme motion and I, like the hon. Gentleman, have agreed that that motion gives sufficient opportunity for Committee members to raise their concerns. We will use the opportunity given by the motion to draw attention to matters that we think need further discussion, particularly the principle of additionality. Notwithstanding the commitment made by the Prime Minister in 1997 that 
''We don't believe it would be right to use Lottery money to pay for things which are the Government's responsibilities'',
the Government have been getting their sticky little mitts on lottery money and we need find a way to prevent that happening in the future. 
We shall also raise what we regard as unprecedented additional powers being given to the Secretary of State. Although we welcome public involvement in deciding how lottery money is to be spent, we believe that the way in which that is done should be considered in more detail. We are concerned about the new opportunities that the Bill provides to allow lottery distributors to be the promoters of the lottery and we shall raise that point through amendments.

Frank Cook: Order. The programme motion, please

Don Foster: My point, Mr. Cook, is that the proposed programme will give us the opportunity to consider such matters, as well as loans and the new purpose-based definition of charitable expenditure. I look forward, under your superb chairmanship to having plenty of opportunity to discuss those matters.
Question put and agreed to.

Frank Cook: I remind the Committee that there is a money resolution with the Bill, copies of which are available in the Room. I should also remind Members that notice should be given of amendments as a general rule. My fellow Chairman and I do not intend to call starred amendments, including any that may be reached during an afternoon sitting.

Clause 7 - National Lottery Distribution Fund: apportionment

Hugo Swire: I beg to move amendment No. 24, in clause 7, page 4, line 21, leave out 'prescribed'.

Frank Cook: With this it will be convenient to discuss the following: amendment No. 25, in clause 7, page 4, line 27, leave out subsection (3).
Government amendment No. 4. 
Amendment No. 55, in clause 14, page 8, line 41, leave out 'or'. 
Amendment No. 56, in clause 14, page 8, line 41, after 'Ireland', insert 'or Isle of Man'. 
Amendment No. 57, in clause 14, page 8, line 46, leave out 'and'. 
Amendment No. 58, in clause 14, page 9, line 3, at end add 
'and 
(d) may be given by the Isle of Man Tynwald in relation to Isle of Man devolved expenditure.'. 
Government amendments Nos. 7 to 9.

Hugo Swire: I should have said at the outset how pleased I am to be serving on this Committee with the hon. Member for Bath, who I know will support many of the Conservative amendments. It seems to have fallen to me to table the majority of the amendments. I was lulled into a false sense of security by the hon. Gentleman, who told me that he is still recovering from the after-effects of the London Olympics Bill. If his response to the programme motion was anything to go by, what he might have lacked in eloquence on Second Reading he fully intends to make up for in Committee.
Let me refer to the Second Reading before I move on to the meat of the clause—I know that you will not allow me to go wide of it, Mr. Cook. It is worth bearing in mind that we last debated this Bill back in June, and at this stage we have no idea when Report and Third Reading will happen. One of the questions that arises is: what is the reason for the delay? That is particularly relevant given that a series of statutory instruments have been laid before us, one after the other—like rainfall—to extend the shelf life of the New Opportunities Fund. The Minister will no doubt wish to explain. 
I am pleased to say that we get straight to the heart of the matter with these amendments. In a sense, we are starting off with the most contentious clause in the Bill. Amendments Nos. 24 and 25 would remove the ability of the Secretary of State to prescribe expenditure by the Big Lottery Fund. We do not believe that the Government should have such wide prescriptive powers in respect of what the Big Lottery Fund spends its money on and the bodies to which it makes its grants. The Minister will maintain, as he has done consistently, both in public and in private, that the Government will not prescribe spending in the controlling and detailed way that we fear—that there will be no micro-managing of the BLF. However, even the Big Lottery Fund itself speaks of having a new, less prescriptive relationship with the Government. 
Whether or not they are fully used, the simple fact is that the Bill contains draconian powers. When passing legislation, one should always be aware of the law of unintended consequences. Our experience of the New Opportunities Fund suggests that, in time, the powers will be used to the utmost. No doubt others will mention the example of Jamie Oliver and the school dinners initiative during the last election campaign. Ministers panicked and decided that they needed some extra cash quickly. Where better to go than to the lottery? How can we be sure that the Government will not prescribe expenditure in other areas in which Government expenditure needs to be supplemented? Where a Government can prescribe—as they seek to do by adding new section 22(3)(d) of the National Lottery etc. Act 1993—they can later proscribe, with all the sinister connotations that that carries. Proscribing is the reverse of prescribing and none of us in this Room would be happy to see that development. 
Some £93 million of lottery funds has already been spent in breach of the principle of additionality. Rightly, Mr. Cook, you will not allow me to stray into a definition of additionality, which is a key part of what we shall be deliberating over the coming few days. I know the hon. Member for Bath is keen to get additionality defined in the Bill. I am talking about spending on MRI scanners in NHS hospitals. I agree that the sum is relatively trivial compared with the £285 million that the Minister has directed to be spent on child care, not to mention the £42 million for fruit in schools—something that I now understand has been taken on by the Department for Education and Skills. Powers of prescription will allow the Secretary of State to use the lottery funds as her personal treasury. In that respect, the powers will mean that the Department for Culture, Media and Sport is the only Department that has its own source of revenue—hypothecated revenue, I would argue. 
How jealous the Chancellor must be when he looks at his falling Treasury receipts and the rising expenditure created by his unleashing of expenditure on recruitment, particularly in the public sector. How jealous he must be when he looks over at his Cabinet colleague the Secretary of State for Culture, Media and Sport, who is a close friend of the Prime Minister, and sees her with an embarrassment of riches—awash with money—and under the clause, she can decide to whom it goes. No wonder the Chancellor wants to direct as much of that money as he can into the health and education services—a trend that we have seen begin—under prescription from a compliant Secretary of State. 
The Bill is trying to invest powers in the Secretary of State and the Opposition are trying to divest them from the Secretary of State. Secretaries of State change, and while I have nothing personal against the current Secretary of State for Culture, Media and Sport, how many of us know for how long we will occupy our present positions, particularly if there is a rather public leadership contest in one's own party?  Before the Minister scoffs at that, I suggest that that will be a situation in which he might well find himself in the not-too-distant future. 
Treasury revenues are falling and a nice big fat lottery is pumping in money. What do the Government do? They decide to give more power to the Secretary of State to prescribe where that money goes. That is unacceptable.

Tom Harris: Will the hon. Gentleman tell the Committee whether in the National Lottery etc. Act 1993, which the Conservative Government introduced to set up the national lottery, the then Secretary of State for National Heritage reserved powers to himself to prescribe good causes? I seem to remember that, at the very least, the Government issued guidance to ensure that only good causes approved by them were set out.

Hugo Swire: The hon. Gentleman will know that language is everything, particularly, no doubt, in Glasgow, South.
Section 6(3) of the National Lottery Act 1998—I happen to have the relevant information in front of me—amended section 22 of the 1993 Act, which clause 7 will also amend. The 1998 Act mentions 16 and two thirds per cent.—I will not repeat each allocation, although we will argue why they were right as opposed to what is now proposed in relation to the Big Lottery Fund. It clearly says that 16 and two thirds per cent. shall be allocated for expenditure. Before that, section 22(2) of the 1993 Act stated: 
''So much of the sum as the Secretary of State considers appropriate shall be allocated.''{**tw4**} 
The difference between the Secretary of State's being able to consider what is appropriate and a guarantee that certain amounts of money will be allocated for expenditure is very different from 50 per cent. of lottery being allocated for prescribed expenditure. That is the kernel of the argument. One is guidance and the other is an instruction. That is the key to the debate, and the hon. Gentleman has done this Committee a favour by rightly putting his finger on it at an early stage. 
The powers of prescription mark a fundamental difference between, on the one hand, the Opposition, the Liberal Democrats, almost the entire voluntary sector, and numerous other bodies and institutions, and on the other hand, the Government, who sit like Canute in a rising sea of opposition. They are oblivious to the clamouring of dissatisfaction with their Bill. Only yesterday, the National Council for Voluntary Organisations called on the Government to rethink their powers of control over the BLF, saying that the Bill 
''compromises the independence of the BLF and its ability to make decisions free from Government interference.''
I alluded earlier to the fact that the Big Lottery Fund itself is nervous about the perception of Government control over its deliberations. Amendments Nos. 24 and 25 would place the BLF on a par with all other lottery distributors. The amendments are reasonable and would not adversely  affect the operations of the BLF, but simply give it more independence, which it would like very much.

Don Foster: The hon. Gentleman, although perhaps not all Committee members, will be aware that his point about the Big Lottery Fund's concern has been clearly expressed in its briefing to Members. It says in its note that it recognises the political concern about the principle of additionality and goes on to make suggestions about what definition should be in the Bill. The BLF shares our concerns, which the Government have clearly not yet accepted.

Richard Caborn: We are not debating additionality.

Hugo Swire: The Minister and the hon. Member for Bath are both correct: at this stage, we are not debating additionality, and, quite rightly, you would not allow us to do so, Mr. Cook. However, we are debating what the Big Lottery Fund—the creature of this Government—is saying about its maker. In a sense, we are debating what the monster is saying about Frankenstein. The fund is the son of the Government, but is saying that it is not happy with aspects of the way in which it has been created. That is clear, and it has nothing to do with the principle of additionality, although that is also one of its concerns, to which we shall come later.
I am grateful to the Minister and his civil servants for providing us with a copy of the National Lottery Act etc. 1993 with the suggested Government amendments; it is an extremely useful point of reference, and I recommend it to all who do not already have it—no doubt it is readily available in all leading bookshops. It shows that the original 1993 Act was far better than this Bill will be if it is enacted unamended. The Minister is fond of saying that occasionally he would like to come to a Committee and agree to all the amendments to see what chaos that would cause, but I would say that that if the Opposition withdrew all our amendments and left the Bill as it is currently drafted, it would lead to even greater chaos. Anyway, we shall not go down that particular road; I digressed for only a minute, Mr. Cook. 
Under section 22 of the 1993 Act, all other distributors, including the New Opportunities Fund, were given a share of lottery funds ''allocated for expenditure''. If such a form of words has sufficed for all other distributors, why change it? If the BLF says that it hopes to enjoy a less prescriptive relationship with the Government, why include prescriptive powers in the Bill? When the Government changed the rules on lottery distributors' independence for the New Opportunities Fund, they rightly attracted much criticism for eroding the independence of the lottery as a whole from the Government. Why then do the Government continue to use and even extend such powers of prescription? I should like the Minister to spend some time explaining the thought process behind clause 7. 
The Government are proud of their consultation record on the lottery; I suspect that we shall be hearing a lot about that in the next few days. On Second Reading, the Minister said: 
''we are responding to what was said in the consultation, which was that people wanted more power to be given to the distributors''—[Official Report, 14 June 2005; Vol. 435, c. 170–171.]
However, binding the BLF to prescribed expenditure, as set out in clause 7, does the exact opposite: it gives the Government more power over more lottery money. Almost every voice that one hears from the charitable sector, from the National Council for Voluntary Organisations and the Association of Chief Executives of Voluntary Organisations downwards, is seriously concerned about the control that the Bill gives the Government over lottery funds. A recent NCVO poll found that 73 per cent. of people wanted lottery funds to be distributed by ''an independent body''. However, the Big Lottery Fund is not such a body as it is constituted in the Bill. 
Other amendments in this group include some that would cover what seems to be an anomaly in directions on devolved expenditure. Our amendments Nos. 55 to 58 would make provision for devolved expenditure in the Isle of Man to be decided by the Tynwald. I must confess that I do not know much about the governance of the Isle of Man and I have never been there, but I greatly admire its spinning legs logo. That is about as much as I know about the Isle of Man. The amended Bill now refers to the Channel Islands and the Isle of Man, but at some stage the Isle of Man disappears. We are suggesting that it should be mentioned again and I look forward to hearing the Minister's thoughts on that. 
That concludes my opening remarks on this group of amendments, which form the kernel of the debate. I look forward to other hon. Members joining in because I am sure that they will have some interesting things to say.

Jo Swinson: Thank you, Mr. Cook. I welcome you to the Chair. I am delighted to be serving on this Committee under your chairmanship and to see so many familiar faces from the Standing Committee on the London Olympics Bill.
We broadly support this group of amendments, some of which would clear up anomalies relating to the Channel Islands and the Isle of Man. However, the main thrust of the controversy is covered by amendments Nos. 24 and 25. We agree that it is unacceptable for the Secretary of State to have the power to make an order prescribing expenditure to good causes, because that is just another Government attack on the independence of lottery distributors. The whole Bill goes much too far in giving that power to the Secretary of State and I am sure that the issue will be revisited during our proceedings. 
I shall demonstrate the extent of that power. During proceedings on the Gambling Bill, my hon. Friend the Member for Bath rightly criticised the Government for including so many opportunities to give the Secretary of State secondary powers. However, that legislation pales in comparison with the Bill that we are considering today. One in 10 clauses of the Gambling Bill gave the Secretary of State secondary powers, but eight of the 23 clauses in the Bill before us make provision for the Secretary of State to make secondary legislation. That is far too much. 
The hon. Member for East Devon illustrated the temptation of the Secretary of State's power to prescribe when faced with difficult budgetary decisions, whatever the Government's good intentions initially. The normal man or woman in the street who goes into their local corner shop to buy a lottery ticket knows that a proportion of the money will go to good causes and that independent bodies will decide which local organisations should receive money. The perception is not and should not be that the Secretary of State and the Government decide how to spend the money, which is why we must remove the power of prescription from the Bill. We support the amendments.

Tom Harris: I understand the arguments made by the hon. Members for East Dunbartonshire (Jo Swinson) and for East Devon, but there is an issue of public confidence that has not been addressed. It is addressed by clause 7.
The national lottery is not as popular as it was when it was launched, although no one expected the high demand for tickets in November 1994 to be maintained. Part of the drop in support stems from bad publicity—sometimes exaggerated—that has highlighted some of the so-called good causes which the public do not believe are good causes. An obvious example is the large amount of money given to the Churchill family to release papers that by any estimation should have been the property of the country in the first place, but which the public purse, or the national lottery, had to pay for to bring into public ownership. 
There have been other cases. I remember a scheme to support failed asylum seekers, funded through the national lottery, that got a lot of criticism. In my constituency I have a number of failed asylum seekers who do not benefit from any state support. I am sure that that is so in the constituencies of many Committee Members. I do not make any judgment about whether organisations that fight for the rights of failed asylum seekers should have state money or national lottery money, but the issue is controversial. That particular scheme did not have the support of the public. 
If we are to engage the public again in support of the national lottery, they must have confidence that the so-called good causes will be prescribed and set out by the Government.

Adam Afriyie: If the Government prescribe the expenditure, does not it add even more distrust? Does not the lottery become an extension of Government rather than an operation that allocates expenditure on its own basis? It would be directed directly by the Secretary of State.

Tom Harris: The hon. Gentleman makes a valid point, but we must accept that the vast majority of the public do not make that great a distinction between the national lottery and the Government. They see the Big Lottery Fund as a creation of the Government, and when things go wrong and the fund makes bad  decisions, they do not blame the fund, they blame the Government.

Hugo Swire: I am almost at the point of asking the hon. Gentleman to join us on the Opposition Benches in the Committee Room, because he makes some points that we shall make subsequently. If I may say so, however, he is confusing two things; the Secretary of State's ability to prescribe—we are debating that in this clause; the mood music coming from the Government—and the fact that 50 per cent. of lottery funds will go to areas that the Secretary of State so decides. It will not address the question of whether the money ends up supporting unpopular causes.
The hon. Gentleman is suggesting something for which we argued in the election, and to which we shall return; a reputational impact clause, which the New Opportunities Fund lacked, so that those in charge of the distribution of funds are able to say, ''Yes, this is a worthy cause, but there are problems with it and it would impact adversely on what we are doing overall.'' A reputational impact clause is needed, not a clause that gives 50 per cent. of lottery spending to the Secretary of State to decide where it will go through prescription.

Tom Harris: The hon. Gentleman is probably right to say that I am regularly confused by proceedings in these Committees. It would not be the first time. However, I can assure him that however confused I may be, I am not so confused that I would ever cross the Floor of this House. Are not the Government democratically accountable for decisions made by the Big Lottery Fund?

Hugo Swire: Will the hon. Gentleman give an example of how the Government are democratically accountable for decisions made by the Big Lottery Fund?

Tom Harris: My right hon. Friend the Secretary of State is ultimately responsible for the management and continuation of the national lottery. That has been the case since it was launched in 1994. Her predecessors in the Conservative Government were equally responsible for the maintenance and the good management of the national lottery. She is responsible for the contract that goes out every seven years, or however long it is, to run the lottery. That is democratic accountability.
Unfortunately, I have spoken for longer than I intended, but if you do not mind, Mr. Cook, I want to finish, as we have spent too long on this clause, with this point. Since the Government are accountable in the public's eye for how well the lottery is run and on what good causes the public money is spent, it is perfectly reasonable for the Government to reserve for themselves the right to prescribe 50 per cent. of the national lottery's expenditure. Therefore, I recommend that my colleagues oppose the amendment of the hon. Member for East Devon, unless my hon. Friend the Minister agrees with it and comes up with some telling responses, which I suspect he will not do.

Andrew Turner: May I echo the words of my hon. Friend the Member for  East Devon (Mr. Swire) and others in saying what a privilege and pleasure it is to serve under your chairmanship, Mr. Cook?
I wish to deal with some of the issues raised by the hon. Member for Glasgow, South (Mr. Harris), and some others that were in my mind before he spoke. First, let me ask the question that struck me most; if the Government feel that the prescriptions are so important, why are they not in the Bill? If they feel the same way that the hon. Gentleman feels—that the Government are accountable for the way in which lottery money is spent—why are they giving the power to make decisions about the prescription to the Secretary of State rather than to Parliament? I assume that the answer to that is that the Minister is unsure whether what he has put on the paper that he has kindly circulated is right. He has some ideas, he is putting some of them forward and he may amend them at a later stage. 
The explanatory notes—I believe that the tradition is for them to be prepared by the sponsoring Department, and therefore, presumably, to have the approval of the relevant Ministers—say rather more than the Minister says about the prescriptions: 
''Possible examples are expenditure on community learning and creating opportunity, promoting community safety and cohesion, and promoting well being.''
However, those were possible examples when the explanatory notes were drafted, but we now have a rather more detailed set of proposed prescriptions. I thank the Minister for his courtesy in circulating them to Committee members. They are contained in the illustrative policy directions, which are subject to consultation. 
The directions are proposed prescriptions to the distributor as to how the money should be spent, but they are, of course, subject to further consultation, and it would be right for them to be amended in light of the consultation. However, one has to ask why the Government have got to the stage of deciding that it is necessary to prescribe and to have broad definitions of prescription, but not to include them in the Bill, albeit that definitions are contained in the explanatory notes. That is presumably because they had not undertaken at an earlier stage the consultation necessary to determine what those prescriptions should be. That is why they are putting forward proposed prescriptions now, with a period of public consultation afterwards.

Adam Afriyie: By prescribing in such detail—or even suggesting prescription in such detail—are not the Government using lottery money as a form of taxation?

Andrew Turner: The Government are certainly getting their sticky fingers on the lottery money. I am not sure whether they would dare to tax for each of the purposes set down in these proposals, although I am sure that they would dare to tax.

Tom Harris: Is the hon. Gentleman suggesting that the Government are not being prescriptive enough?

Andrew Turner: The hon. Gentleman is suggesting nothing of the kind; he is asking why the Government want to give this power to the Secretary of State rather  than to Parliament. If the Government are saying that it is right that there should be such prescription—that is what the hon. Member for Glasgow, South advanced—why are the Government saying the prescription should be made not by Parliament, but by the Secretary of State? We believe that it is not necessary for there to be such a high level of prescription, and would oppose it in any case.
However, I was trying to deal with the point that the hon. Member for Glasgow, South advanced. He was saying that there is not sufficient public confidence in the lottery, and that there is confusion among the public about the lottery and the Government. [Interruption.] The hon. Gentleman denies that he said that. We can read the record in due course, but perhaps I misunderstood him. I thought he said that the public held the Government accountable for the way in which lottery money is spent.

Tom Harris: If I did suggest that there was confusion between the Government and the lottery fund, I will withdraw the statement. There certainly is an association, as there should be.

Andrew Turner: I will settle for that for the time being. The hon. Gentleman advances the theory that there is an association, and that there should be one. I am advancing the theory that there is confusion, which there should not be. One reason for the confusion is the promotion of the very association to which he refers. That promotion is undertaken by the Government, as, in addition to the powers that are set out in previous legislation, they tend to lean on the lottery to spend money on their favourite causes. We have given examples, and I shall not go over them again. The Government collar money from the lottery, or they persuade the New Opportunities Fund to spend money on their favourite causes. I do not know quite how they do it, but I am sure that the Chancellor of the Exchequer and other Ministers are capable of persuading the fund and the lottery distribution agencies that what they have in mind is a good way to spend the money, and—lo and behold—the money pops up and the Government spend it.

Hugo Swire: Does my hon. Friend agree that the best way of determining how the decisions are arrived at would be to invite the Minister to discuss a specific example?

Frank Cook: Order. It would be helpful, especially as I am partially deaf, to address words directly to the Chair.

Hugo Swire: I apologise, Mr. Cook. I was suggesting to my hon. Friend that one way of illustrating how the Government arrive at these directives would be to invite the Minister to discuss a specific example such as, perhaps, the initiative of fruit for school lunches, with which Jamie Oliver was involved. I alluded to it earlier. It would be interesting and would perhaps answer my hon. Friend's question as to how the decision was made, what Government direction there was, what dialogue there was between Ministers and how it was decided in a panic to get the money from the lottery. That would be very informative.

Andrew Turner: I thank my hon. Friend for that suggestion. It would indeed be interesting to see the  e-mails that were exchanged between the relevant Minister and Mr. Oliver. [Interruption.] The Minister is saying that I can see them.

Richard Caborn: Under freedom of information.

Andrew Turner: Then I make that request here and now. Perhaps the Minister will place in the Library copies of the e-mails that were exchanged between the Secretary of State and the lottery distribution organisations that produced, almost overnight, such a large amount of money. Many lottery applicants in my constituency would count themselves lucky to receive a response on far smaller amounts of money in three to six months, let alone overnight.
Why are the Government asking Parliament to give the Secretary of State these powers? If it is so important to prescribe how lottery money is spent, why are they giving powers to the Secretary of State and not to Parliament? Parliament is not well known for overturning the decisions or preferences of Ministers. We do so when it is necessary, but we do so seldom. The Government would not lose power in that respect, but they would at least establish that a future Secretary of State could not distort funding decisions. My hon. Friend the Member for East Devon said that we should always try to legislate not just for the present but for the future. 
Let me give an example. What if an incoming Secretary of State were to decide to promote a grammar school for every town? I accept that that is probably the policy that will be revealed this afternoon by the Secretary of State for Education and Skills. But what if a future Secretary of State wanted to do that? All that would be required would be for that Secretary of State to speak to the Secretary of State for Culture, Media and Sport and suggest an amendment to the prescriptions and, lo and behold, all the money would be spent in a different way. 
That is the power with which we are investing the Secretary of State, rather than Parliament. It has always been my contention that the less that is done by delegated legislation and the more that is done by Parliament, the more democratic the outcome; albeit that the outcome might be the same.

Richard Caborn: I shall try to keep to the amendments rather than refer to the debates on Second Reading. The amendments are concerned with the things that the Big Lottery Fund will spend its money on, as well as the territories in which it can spend it. Amendment No. 24 would remove the Secretary of State's power to prescribe expenditure for the new good cause. Amendment No. 25 would remove the related order-making powers. Taken together, the amendments would mean that the Big Lottery Fund could not allocate money for any expenditure that is connected with health, education, the environment or charitable means. I am sure that that is not the intention of the hon. Member for East Devon.
I am aware that some people, particularly those in the voluntary and community sector, have questioned  why the Government need a power to narrow down the good cause. There seems to be specific worry about our intention to use the power to set the three high-level themes, as described on Second Reading, about which the Big Lottery Fund has consulted. We could not be accused of not consulting the wider public. There may be a prosecution of cases in respect of single-issue organisations; I do not know. I submit to the Committee that all the consultation documents, licensing proposals and the national lottery funding decision document have all been subject to much debate. It came out clearly from those consultations that community learning and creating opportunity, promoting community safety and cohesion, and promoting well-being were the high-level themes. I wish to explain why the worries are misplaced. 
The new good cause is much broader than the other good causes of sports, arts and heritage. It is therefore not sensible for half of the lottery money to be allocated to such a broad good cause without further instruction, while the other half is allocated to much more specific good causes and sub-divided between different distributors. We need to be able to set out clearly at the highest level the types of expenditure on which the Big Lottery Fund should focus. Given that that will be fundamental to the way in which the Big Lottery Fund operates, it is right that it should be done by secondary legislation to which reference has been made. Indeed, we have demonstrated to the Committee the openness of the type of secondary legislation that we propose. That, in itself, would be subject to parliamentary scrutiny. 
Mr. Swire rose—

Richard Caborn: Bear with me. Let me develop the theme. Parliamentary scrutiny is important to the integrity of the lottery; make no mistake about that. What has sometimes happened in Parliament could have undermined the lottery. The lottery is an institution that crosses all parties, but it cannot remain static. It needs to move in concert with what people believe to be the purpose behind it. That is why we have taken a lot of time and trouble to have wide consultation. Some people might not like consultation, but if they want to knock our consultation process with the British people, let them do so. We have acted in good faith because we believe the lottery to be an institution worth preserving.
As I said, the Big Lottery Fund has consulted on the three themes. There were more than 850 responses overall, with approximately 630 people specifically answering the questionnaire. Some 50 per cent. of responses were from the voluntary and community sector and 21 per cent. were from local authorities; the remainder of responses came from a mix of public bodies. The majority of respondents—58 per cent.—agreed that the themes, the accompanying outcomes and priorities will provide a sensible and flexible strategic framework for future funding. Only 5 per cent. of respondents disagreed. 
Therefore, we believe that it is important to remember that the order-making powers will allow us to prescribe devolved expenditure. Devolved expenditure will be the responsibility of new country  committees, subject to directions issued by the relevant devolved Administration. 
The Bill represents a significant devolution of power to Scotland, Wales and Northern Ireland, and the ability to prescribe devolved expenditure is central to achieving that. For the reasons that I have given, we cannot accept the amendment, and I ask the hon. Gentleman to withdraw it. 
I turn to the Government amendments about the Channel Islands, and I will then deal with other amendments.

Hugo Swire: It is not for me to chair proceedings, but I must say that I am enjoying what is almost a stand part debate on the clause. May I return the Minister to the central philosophical point behind the amendment, which he has so far failed to address clearly; the principle of prescription? He will see that amendment No. 25 deletes subsection (3) What is wrong with the original provision of the National Lottery etc. Act 1993? It clearly mentions the Secretary of State considering whether allocations were ''appropriate''. We could live with that, but not these appalling, draconian powers of prescription.

Richard Caborn: We are bringing three lottery funding streams together; the New Opportunities Fund, the Community Fund and the Millennium Commission. The Bill proposes how we are to achieve what was outlined in the Government's wide consultation. The Big Lottery Fund then held a further consultation. We believe that the provisions in the Bill are in concert with what the British people wanted in that wider consultation.

Hugo Swire: In answer to a question that I put to the Secretary of State only a few days ago about the balances of the Millennium Commission, I was told that the commission's current balance, held under the national lottery distribution fund, is £83 million, of which £67 million has been committed to existing grant programmes. For the sake of £12 million or £13 million, it is quite extraordinary to pray in aid the merging of the Millennium Commission, NOF and the Community Fund. I do not think that the merging of three organisations, one of which has only about £13 million left, is sufficient argument for changing the whole philosophy from one in which the Secretary of State makes suggested allocations to one involving these appalling prescriptive powers.

Richard Caborn: If what the hon. Gentleman said were absolutely true, in terms of the balances that were left, that might be a sufficient argument. The hon. Gentleman may have been correct about the cash balances left, but there are also the receipts that we will get from the sale of the dome—

Hugo Swire: Ah, the dome.

Richard Caborn: Does the hon. Gentleman want to listen? I said that the answer to his question is probably down to the cash reserves at a given time. There could well be under-spending on a number of the Millennium Commission's projects; even at the committee meeting last week, we heard that that was the case. Three or four of the projects deposited money back because they could not deliver in the time scale.  There is also the sale of the dome, receipts from which will go to the Big Lottery Fund. There is a whole series of revenue streams coming from the Millennium Commission, and that is why the Bill is framed in such a way. It also brought it together with NOF and the Community Fund. So although the answer that the hon. Gentleman mentions may be factually correct, that will not be the only stream from the Millennium Commission to the Big Lottery Fund.

Hugo Swire: I hope that the Minister is right, and that the answer is factually correct, because the answer is from the Minister himself. To read what it says:
''The Millennium Commission's current balance held in the National Lottery Distribution Fund is £83 million, of which £67 million has been committed to existing grant programmes and for operating costs. The Millennium Commission remains in operation, and Commissioners retain discretion to offer further grants where they believe this to be appropriate.
Under the provisions of the National Lottery Bill, the Big Lottery Fund as successor body would take on any remaining balance and funding commitments.''—[Official Report, 21 October 2005; Vol. 437, c. 1244W.]
If the Millennium Commission remains in operation and the commissioners retain the discretion to offer further grants where they believe them to be appropriate, and the only amount of money available is the difference between £83 million and £67 million, there will not be much of a balance left. By all means, let us talk about the merging of the other two bodies, but the Minister should not pray in aid the Millennium Commission as a third pillar that needs bringing under control when there is effectively nothing left in it.

Richard Caborn: The merging of the three lottery funds, the Community Fund, NOF and the Millennium Commission, is in the Bill. Yes, the Millennium Commission will stop operating. It was expected that the Bill would go through—and therefore that the Millennium Commission would cease to operate—probably by early next year. That is not the case. Instead of being wound up in March, it will probably continue until September or October. We are being practical about that. It has to operate, which is why those answers were given in that letter. That does not explain why there could be underspends on some of the major schemes undertaken by the Millennium Commission. It could be that the receipts we will get from the dome—not now, but two or three years down the road—will go into that process.
We will tidy the whole of that process up as well as bringing NOF and the Community Fund together. That is the object of the exercise and it has been accepted out there in the real world through the consultation we have carried out. We are going slightly wide of the amendment but we try, as we have done in the explanatory notes, to be as open with the Committee as possible to ensure that we have a full, informed debate.

Andrew Turner: I am particularly grateful to the Minister for putting on record some figures that I had heard from the Big Lottery Fund, but had not brought with me. When I heard those figures, I told the fund that in my constituency, whose population is 130,000, there was a consultation on the local strategic plan called Island Futures, to which 440 people  responded. That is a response rate of one third of one per cent., which I said at the time was pretty pathetic.
We are talking about a country with a population of 50 million, out of which 800 people have responded, most of whom are representatives of voluntary organisations, not ordinary members of the public. A quarter of them are representatives of local authorities, who are certainly not ordinary members of the public. Is the Minister convinced that the consultation really got down to the level of the people to whom the hon. Member for Glasgow, South referred when he described the dissatisfaction at the way in which lottery money was being spent?

Richard Caborn: Yes. It is simple. The British people are voting with their feet; sales of the lottery have gone up 2 or 3 per cent. during the recent past. If there were anything fundamentally wrong with the lottery and the British people did not like what was happening, they would not play it. Members should go back and look at the campaign run by the Daily Mail. If someone wants to affect the lottery, they get questions asked in the House of Commons that are followed up by the Daily Mail, which attacked asylum seekers, and then lottery ticket sales go down.
I submit to the Committee that ours is one of the most successful lotteries in the world. It has integrity and commands support from all parties and the wider community. That is why people play the lottery. It is a fact that sales of the lottery have started to go up. As my hon. Friend the Member for Glasgow, South said, we see declines pretty well immediately after all lotteries start, and they need to be refreshed. The sustainability of our lottery is probably second to none. It has kept its appeal to the people who play it, which is a credit to those who run the lottery, the distributors, Camelot and everyone who has supported it. 
When the lottery was attacked in that unscrupulous way, sales went down and the British public started to have some questions about it. That is why debates like this are very important to the integrity of the lottery. That is why the consultation that took place. I do not believe the consultation to be as narrow as the hon. Gentleman indicates because the organisations that responded to it represent thousands, if not millions, of people throughout the country. The broad thrust of that consultation, at Government level and that of the Big Lottery Fund, was that the themes are broadly right. The secondary consultation underlined that. To reflect that, we introduced the Bill, with secondary legislation that will be voted on by Parliament. 
We believe in such accountability, a further example of which is that the Secretary of State is giving evidence to a Select Committee at the moment, part of which concerns lottery expenditure. That is a good way of scrutinising matters and putting them in the public domain, which is what we are trying to achieve. If Members consider the history of the lottery, it has gone from capital, to revenue, to a better division of expenditure, to bringing in small grants and making it user-friendly. In concert with that consultation, we believe in continuing to evolve the  lottery so that it will have the confidence of the British people.

Hugo Swire: I entirely share the Minister's sentiments about the continuing popularity of the lottery being a remarkable achievement, not least because I believe that the Government's tax take makes it the most overtaxed lottery in the world. However, call me a cynic, but I disagree with him about the reasons why people play the lottery. I do not believe that the majority of people go into their corner shop on a Wednesday or a Saturday with altruistic thoughts of helping out some fund or other; I think that they play the lottery because they want to win £6 million. That is certainly why I play it. [Interruption.] Well, yes, I am mercenary. When I am on a ministerial salary, in the next year or two, I will be able to take a more elevated view of such matters. Unfortunately, that moment has been delayed by the electorate, who were consulted in their numbers on which Government they wanted—although that was not the case with the Bill and the division of funds.
The Minister cannot have it both ways. Even his own Back Benchers do not agree with him. The hon. Member for Glasgow, South drew attention the adverse effect on lottery sales and the lottery's reputation of the stories that the Daily Mail reported. That is why I suggested that we include a reputational impact clause, which would deal with that. However, to return to the core of the argument, the stories about fattening guinea pigs—or whatever else it may have been—are no reason to give draconian prescriptive powers to the Secretary of State. That just does not add up and neither does the Minister praying in aid the rather spurious consultations he has carried out with 800 people.

Richard Caborn: There is no more prescription than there was in relation to the New Opportunities Fund in the National Lottery Act 1998. As I have just explained, we have devolved matters to Scotland, Wales and Northern Ireland. A wide consultation has been carried out by the Government and the Big Lottery Fund. We have consulted not just individuals, but organisations. That is on the record. Only 5 per cent. disagreed with the way in which the consultation was going.
I want to continue because otherwise we will not get through the business before us. I know that Members want to challenge other areas of the Bill, as well. I will move on to the Government amendments on the Channel Islands. I will then deal with the amendments that have been tabled about the Isle of Man. The Bill already makes provision for people on the Isle of Man to benefit from the national lottery by allowing the distribution of proceeds from the lottery on that island. Representatives from the Jersey and Guernsey Governments have sought similar provisions to allow—eventually—proceeds from the national lottery to be distributed to their islands once they have established the appropriate licensing and regulatory framework. 
Through the Government amendments, we hope to increase the scope of the national lottery to include not  just the Isle of Man, but the Channel Islands. National lottery tickets are not currently sold on the Channel Islands, but the island authorities, the Department and the National Lottery Commission are working together to establish the appropriate licensing and regulatory framework to allow tickets to be sold there. Once that has been achieved, we want to be able to ensure that proceeds from the national lottery can benefit the people of the Channel Islands. The amendments will achieve that in the same as that the Bill achieves it for the Isle of Man: by allowing the Big Lottery Fund to withdraw money from the national lottery distribution fund to fund projects in the Channel Islands.

Hugo Swire: Given that there is a tax take on the lottery, how would selling lottery tickets on the Isle of Man and the Channel Islands affect the fiscal and taxation arrangements? I understand that the arrangements are very different.

Richard Caborn: I cannot answer that question straight away, but I will either write to the hon. Gentleman or give him an answer later in our consideration of the Bill.
Government amendment No. 4 will allow the prescribed expenditure under new section 22(3), which will define the Big Lottery Fund's good causes, to include expenditure in any of the Channel Islands, thereby allowing the fund to make grants to bodies on those islands. Government amendments Nos. 7 and 8 provide that money held in the national lottery distribution fund may be used by the Big Lottery Fund for the benefit of the Channel Islands. Clearly, Government amendments Nos. 4, 7 and 8 are dependent on each other. 
Government amendment No. 9 allows the Big Lottery Fund to delegate any of its funding functions to another body established on the Channel Islands. That would enable a body with local experience of the Channel Islands to make decisions on behalf of the Big Lottery Fund. By enabling the distribution of lottery money on the Channel Islands, the amendments would allow the people on the islands to join in a much larger lottery. That would bring them larger amounts of lottery funding and the opportunity to win large prizes. However, we in the UK would also benefit from the Channel Islands joining. We would experience a small but positive increase to the national lottery distribution fund—a view that is strengthened by figures suggesting that the islanders would be above-average ticket buyers. The Channel Islands would have access only to the new good causes of charitable expenditure, health, education and the environment, meaning that they would have access to only half the good cause money. In spite of that limitation, there remains considerable interest in being involved in the national lottery. 
Amendments Nos. 55 to 58 would amend clause 14, but they are related to the matters that we are debating. I see the point of the amendments. On the face of it the Isle of Man is treated differently from, say, Scotland; but there are legal and practical reasons for that. The Isle of Man is not a part of the United Kingdom, and the constitutional relationship between  Parliament and the Tynwald and the Isle of Man Government is complex. It is not normal practice for the UK Parliament to confer functions on the Tynwald, a legislative body, or on the Isle of Man Government. 
Similarly, it is not normal practice to give a non-UK Government powers to be exercised in the UK covering a UK public body. A further difficulty lies in the fact that the Isle of Man authorities are not subject to UK law. It would be impossible to enforce the various requirements of devolved Administrations such as the Scottish Executive in relation to the issuing of directions—the requirement to consult the Big Lottery Fund and to obtain the consent of the Secretary of State before giving the directions. 
The provision to allow the Big Lottery Fund to distribute lottery money in the Isle of Man has been developed in consultation with the Isle of Man authorities. We can be confident that it will not cause any difficulties when it comes to distributing money from the Big Lottery Fund to good causes in the Isle of Man. It was not raised as a problem in our discussions with the Isle of Man authorities, and the powers of direction will be used broadly to define community priorities that accommodate most schemes that the Isle of Man people might want to see funded. We shall consult them about that. That last point in particular should give the hon. Member for East Devon some real assurance. In light of it I ask that the amendment is not pressed to a vote.

Hugo Swire: I wish that I could agree to the Minister's plea in his last sentence and not press the clause or the amendment to a vote, because that would mean that he had gone some way to reassuring us about them. However, I would be unpopular with the Opposition were I not to take the contrary view.
We had an interesting contribution from the hon. Member for East Dunbartonshire, whom I welcome. I think that this is the first Committee on which she has served. It is the first on which we have served together, and she said nothing with which I would disagree. 
The Minister referred to the integrity of the lottery. He is keen on that, and we are certainly keen on it. He referred to it as an institution of which we can be proud. Of course it is. It is a wonderful institution, which was thought up by the Conservative party. It was very much the baby of the then Prime Minister, Sir John Major. 
Those of us on the Committee who watch Andrew Marr on Sunday will have seen the ex-Prime Minister in a pair of smart pink socks telling Mr. Marr, who was not wearing a smart pair of pink socks—indeed, he may not have been wearing any socks at all—why he thought that this Bill went contrary to the spirit of the founding fathers. Sir John feels very strongly about that, but I shall not digress onto the principle of additionality about which he is so concerned. 
The Minister says that we must keep in touch with what people out there believe the lottery is for. Most people, particularly in the Channel Islands, buy lottery tickets to acquire a good win; it is only human nature so to do. People have an interest in what lottery money should go to, not least if they happen to be associated  with some local endeavour seeking to attract lottery funding, but beyond that I am rather doubtful of their interest. We will return to the consultations that his Department has had with the people out there, as he refers to the great British public. 
My hon. Friend the Member for Isle of Wight (Mr. Turner) said that there are 50 million people in this country, although I think that there are rather more than that. Perhaps he is confused by the number of people holidaying on the Isle of Wight. Of 50 million people, 800 responded to the consultation and we have heard of all the vested interests that many of those 800 people represent, from voluntary bodies to local authorities. My hon. Friend said that 5 per cent. disagreed, but 5 per cent. of 800 according to my limited mathematical ability is 40, so 40 people disagreed. That gives some indication of the ridiculousness of quoting that sample as meaning anything to anyone. It just does not stack up. 
The provision vests tremendous power in the Secretary of State. Under the law of unintended consequences, a Secretary of State less scrupulous than the present one could direct 50 per cent. of what amounts to hundreds of millions of pound per annum to anything that he or she deemed fit, with the compliance of other Cabinet Members. That is unacceptable and the Minister's attempts to reassure us do not go far enough, which is why I shall press the amendment to a Division. 
Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 9.

Question accordingly negatived.

Hugo Swire: I beg to move amendment No. 26, in clause 7, page 4, line 23, leave out from 'charitable' to end of line 26 and insert
'and may be connected with health, education or the environment'.

Frank Cook: With this it will be convenient to discuss clause 19 stand part.

Hugo Swire: That very narrow vote was perhaps a stronger indication of trouble ahead for the Minister than any consultation that the Minister's Department had with 800 people. We may be small in number, but 7:9 is pretty close and if that is not indicative nothing is. Incidentally, although we cannot defeat the Government on this field of battle, there is always the other place, where even Labour peers view the provision with considerable disquiet, as we will see when the Bill goes there. 
Amendment No. 26 and clause 19 deal with an important part of the Bill: the definition of charitable expenditure. The amendment would make a subtle but crucial change to clause 7 by ensuring that all Big Lottery Fund expenditure is charitable. At the moment, clause 7 refers to 
''charitable, or . . . connected with health, or . . . connected with education, or . . . connected with the environment.''
That is the purpose of amendment No. 26. 
The argument about what proportion of Big Lottery Fund expenditure—if not all of it—should go to charities is the subject of another amendment in a different group, which we will not address now. However, I say to the Minister that the easiest—and most popular—escape route out of the difficulties he faces in relation to the proportion of BLF resources that should go to charities is to accept amendment No. 26 and to make all BLF spending charitable. If he did that, there would be no further need for any kind of disagreement. I look forward to hearing the Minister's arguments against the amendment—if he makes them, because he might acquiesce—and to hearing why he does not want to increase funding to charities. I hope that he will give me some examples of what non-charitable grants the BLF will make in the health and education sectors. 
That brings us to the definition of charitable expenditure. The Government seek to broaden that definition by changing it from an institution-based definition to a purpose-based definition. That is not merely a semantic change; it is fundamental. It changes the meaning of charitable expenditure from expenditure by institutions that are charitable, benevolent or philanthropic to expenditure on charitable, benevolent or philanthropic activities. However, the voluntary sector strongly opposes changing the definition of charitable expenditure. It is clear to it, and to us, that the definition given in section 44(1) of the National Lottery etc. Act 1993 is the correct one: 
'' 'charitable expenditure' means expenditure—
(a) by charities, or
(b) by institutions, other than charities, that are established for charitable purposes (whether or not those purposes are charitable within the meaning of any rule of law), benevolent purposes or philanthropic purposes''.
That is scratched out by the Bill, and the new definition means that there is no guarantee that charitable expenditure will mean expenditure by voluntary and community sector organisations. 
The new definition is contrary to the original definition of a charitable good cause. Under the Bill, any institution, be it statutory, voluntary, or even in the private sector can undertake charitable, benevolent or philanthropic activities. Our fear—which is entirely reasonable given the Government's track record in respect of the misuse of lottery funds—is that spending by public or local authority bodies', be they primary care trusts or primary schools, will be classed under the definition in this clause as charitable expenditure. The new definition of charitable expenditure also has implications for the Big Lottery Fund and the  Secretary of State's declared commitment to allocate 60 to 70 per cent. of expenditure to voluntary and community organisations, which we will debate later. I know that the hon. Member for Bath and I agree that we would like that to be included in the Bill. The definition in the Bill might be intended to be a commitment to charitable expenditure, but it provides no reassurance for the voluntary and community sector. 
The Minister, arguing on behalf of his Department and the Secretary of State, will no doubt argue that their reason for changing the definition of charitable expenditure is that in the past the Community Fund was unable to fund some organisations that had the wrong legal constitution. However, I would argue that the arguments about what the Community Fund could or could not fund are no longer relevant, because the Community Fund is being rolled up into the Big Lottery Fund, whose good causes go beyond charitable expenditure and which has the power to fund bodies outside the voluntary and community sector in any case. That was most recently evidenced by the people's millions shortlist, which includes schools and local authorities among those competing for lottery grants, and which I am sure the Minister will refer to as an indication of the Government's response to what people think and want from the lottery. The Big Lottery Fund therefore is not subject to the same restrictions as the Community Fund. I have no objection to the BLF supporting organisations outside the sector, but that support should not be classified under the charitable expenditure good cause. 
To recap, removing clause 19 would mean returning to the original meaning of charitable expenditure. Given section 44(1) of the 1993 Act, to which I referred earlier, it would ensure that charitable expenditure continues to mean expenditure to voluntary and community sector organisations, rather than particular activities undertaken by any institution and perhaps registered for a particular fundraising round as a charitable endeavour. Finally, it would provide important guarantees about future lottery funding to the voluntary and community sector.

Don Foster: I have a great deal of sympathy with the contribution just made by the hon. Member for East Devon and entirely share his concerns. In my brief contribution, I hope to suggest to the Minister a way in which he may assuage all the concerns but still accommodate some of the aspects that he wants to keep—in other words, how he can have his cake and eat it too.
A concern that has been expressed by many people is that the Bill would make it extremely difficult to guarantee that the voluntary and community sector would continue to be the prime beneficiary of funding from the soon-to-be-established Big Lottery Fund. The hon. Gentleman rightly says that in later amendments we will debate putting in the Bill a requirement that a significant proportion of BLF funding should go to the voluntary and community sector. Were the Minister to indicate that he would be minded to accept amendment No. 27, perhaps there  would be less concern about the definition of charity, which we are presently debating. 
Amendment No. 26 would ensure that all BLF money went to charity, and voting against clause 19 stand part would clearly define a charity as an organisation rather than, as the Bill proposes, as a purpose. However, were the Minister to accept a clear requirement that voluntary and community organisations received money from the BLF—60 or 70 per cent., or whatever might be decided at a later stage—with the remaining 30 per cent., let us say, going to charitable purposes, I suspect that that would be acceptable to the Committee. Therefore, he may wish to reflect on the compromise that I am suggesting. He will have an opportunity to do so when we come to amendment No. 27. 
However, if the Minister is not prepared to indicate at this stage that he will accept later amendments, particularly amendment No. 27, we will strongly support amendment No. 26 and will vote against clause 19.

Andrew Turner: I shall concentrate on clause 19, which is grouped with the amendment tabled by my hon. Friend the Member for East Devon. Before I go any further, I would like to ask the Minister for a definition of the words ''benevolent'' and ''philanthropic'' for the purposes of the Bill. I see no definition in the Bill and I know of no definitions elsewhere in law. Perhaps other definitions exist. Perhaps the Minister will state whether he intends to apply definitions found elsewhere in law, but he is not applying any definition of ''charitable'' found elsewhere in law.
My hon. Friend the Member for East Devon has spoken of the danger of diverting money from charitable organisations to organs of the state, such as local education authorities. That is one of my concerns. Money may be abused if it is put under government control at a local rather than national level. I should like to examine the consequence of substituting a different definition for that of ''charitable expenditure'' in section 44(1) of the 1993 Act. 
I understand that we were doing so badly in the Boer war that training men in the use of arms was defined as a charitable purpose. A number of gun clubs up and down the country were established with the function of training men in the bearing of arms. Recently, the Charity Commission decided that that was no longer a charitable purpose and those gun clubs have lost their charitable status. Under the definition in this Bill, it appears to me that although the clubs are no longer charities, they could apply for money from the lottery. 
They could say that although they were not charitable institutions, the purpose to which they wished to put the money was charitable—not if it involved training men in the use of arms, but if it involved, for example, educating men in the habits of small furry animals, so that the men might more successfully pursue and kill them. That would be a charitable purpose, because education is defined as such a purpose. In case the Minister thinks that a far- fetched example, let me substitute another. At the moment, the Conservative party is not a charitable organisation.

Tom Harris: It should be.

Andrew Turner: I am grateful for that suggestion, because charities are allowed to undertake political activities as long as they do so in pursuit of their principal objective. However, that means that an organisation has to be a charity before it can obtain money from the lottery fund to undertake a political activity.
As some of my hon. Friends have commented, the Conservative party takes a great interest in the issue of human rights in Zimbabwe. At least, some of my hon. Friends do, although other right hon. and hon. Friends have suggested that the interest is unhealthy. I do not take that view, but the protection of human rights is subject to the Charities Bill passing through this House in the same form as it has almost passed through another place. The protection of human rights is a charitable purpose, so the Conservative party could apply to the national lottery for money to promote human rights in Zimbabwe and there would be nothing to prevent the lottery from granting it. As far as I know, the Minister has still not proscribed or prescribed the Conservative party, although it is still open to him to do so—but I am not allowed to go back down that track. 
Perhaps, as Ministers have a habit of doing, the Minister would indicate to the lottery distribution organisations that he was not happy for money to go to organisations that were registered under the Political Parties, Elections and Referendums Act 2000. 
Let us think of another example. The anti-war coalition believes—and a number of Members on both sides of the House agree—that it is promoting human rights in Iraq: the right not to be bombed by the United States. The promotion of human rights is a charitable purpose. Although the anti-war coalition is not a charitable purpose, the promotion of human rights is and the Minister is saying through the Bill that he is happy—or at least not unhappy—for the anti-war coalition to apply for and perhaps receive lottery funding to promote human rights in Iraq. That is the consequence. Will the Minister say whether it is an intended consequence?

Richard Caborn: Amendment No. 26 would amend the definition of a good cause so that all the Big Lottery Fund expenditure must be charitable and connected with health, education or the environment. Let me explain why we have so drafted the new good cause. The national lottery funding decision document that we published in July 2003 was clear that the new lottery distributors would continue to fund charities, the voluntary sector, health, education and the environment.
In drafting the Bill, our aim has been to combine the existing Community Fund and the New Opportunities Fund good causes in a straightforward  way, while preserving the distinction between charitable expenditure and expenditure connected with health, education and the environment. It is likely in practice that most, if not all, expenditure on health, education and the environment will also be charitable. However, we need to retain flexibility to allow projects in areas that may not fall within the definition of charitable expenditure to continue to be funded when the Big Lottery Fund judges it to be right. That decision will be taken at arm's length, not by the Government. For those reasons, I ask the hon. Gentleman to withdraw the amendment.

Adam Afriyie: Will the Minister give a couple of examples of when the definition would have been used in previous allocations of funds? I am not aware of a situation in which funding was withheld on the basis of the definition of a charity.

Richard Caborn: A number of organisations are not charitable, such as social enterprises, mutuals and residents' associations. They were all turned down because they did not have the right constitution to be charitable. I am sure that the hon. Gentleman will agree that several organisations in his constituency fall within the definition, but that, if they had had access to the funds, they would have added real value to his constituents. We want to broaden the definition of ''charitable'' to the areas that I have just described for non-profit organisations and residents' associations. It is the purpose of the organisation and not its organisational aspect that we believe it is right to consider. The hon. Gentleman may want to give chapter and verse, but I wanted to explain the overall principle of making funding available to organisations that were debarred from receiving moneys but were well within the broad meaning of good causes.
Clause 19 defines ''charitable expenditure'' in respect of the Big Lottery Fund good causes as 
''expenditure for a charitable, benevolent or philanthropic purpose.''
The new definition used to decide whether expenditure is charitable is based on its purpose. The existing definition of ''charitable expenditure'' in relation to the Community Fund was based on the institution. The new definition will ensure that in future the focus is on projects rather than the institution, as I have just explained to the hon. Member for Windsor. 
In the past, the Community Fund has been unable to fund some deserving projects simply because the organisation applying for funding had the wrong sort of constitution. A swathe of good causes were missed out that could have been aided by such lottery funding.

Andrew Selous: The Minister mentioned residents' associations, mutuals and social enterprises—all excellent organisations that we want to prosper in our constituencies. Would they not be covered by section 44(i)(b) of the 1993 Act, which states:
'' 'charitable expenditure' '' means expenditure—
(a) by charities, or
(b) by institutions, other than charities, that are established for charitable purposes (whether or not those purposes are charitable within the meaning of any rule of law), benevolent purposes or philanthropic purposes;''
My question to the Minister is straightforward. Are not residents associations, mutuals and social enterprises covered by that provision?

Richard Caborn: They may well be, but for the clarity of the Bill we believe that it is important that that provision be amended as well, to ensure that there is no dubiety. Therefore, we believe that the clause needs to make it clear that we are moving away on this. We have an opportunity, do we not, when bringing in the new lottery fund and NOF to find out what mistakes were made and to find out by means of consultation what people want the money to go to. There is a restriction on that if it is kept on the narrow part of charitable.
I have explained which organisations were not allowed to be funded under the old regime. We believe that they ought to be funded under this new one. In that sense, this is belt and braces. We are ensuring that it is crystal clear. It is not just about the definition of ''charitable''; it can go beyond that. It is about the purpose. Therefore, there is no contradiction. We are putting that in the Bill to ensure that we respond to the need.

Andrew Turner: The Minister seems to be arguing that he is inserting a clause because the existing words ''charitable expenditure'' are interpreted as meaning only expenditure by charities. Section 44(1)(b) of the 1993 Act, to which my hon. Friend the Member for South-West Bedfordshire referred him, says that the institutions may be established not only for charitable purposes but for
''benevolent purposes or philanthropic purposes''.
Therefore, why does the Minister need the change?

Richard Caborn: I believe that the Community Fund's experience was that it was limited in its ability to give to organisations that it would have given to had the definition been different. We now have an opportunity to put that right, and that is what we are recommending.

Adam Afriyie: I repeat my question again. Will the Minister now give an example of what was excluded under the current legislation? I think that the examples he gave were incorrect.

Richard Caborn: That is not true. The definition that I gave to the hon. Gentleman is the correct one. The Community Fund—I will return the note because I cannot read it properly—was not able to fund organisations as charitable beneficiaries because restrictions were placed on it. That is why I gave the examples of those that were not allowed to be funded, and were not funded—social enterprises, mutuals and residents associations. They were turned down for funding because of the narrow eligibility criteria, even though their projects were clearly for the public good. Does the hon. Gentleman agree that the Community Fund was not allowed to fund organisations—and did not fund them—because of the wording of the 1993 Act?

Don Foster: The Committee is asking the Minister why those organisations were turned down when the definition in the current legislation, which he wishes to change, specifically refers not only to charities but to 
''institutions, other than charities, that are established for charitable purposes (whether or not those purposes are charitable within the meaning of any rule of law), benevolent purposes or philanthropic purposes;''.
Will the Minister do as the hon. Member for Windsor keeps asking and give an example of something that was legitimately turned down because it fell outside the definition?

Richard Caborn: The specific example is the residents associations. They are not set up for charitable purposes, and therefore would not have been eligible under the 1993 Act. That is a fact; that is what I am told by officials quite clearly. We are trying to rectify that under the Bill.

Don Foster: I hope that you will not get too upset with us, Mr. Cook, but we must pursue this. The Minister has to say not only that residents associations were not set up for charitable purposes, but that they were not set up for
''benevolent purposes or philanthropic purposes''.
Did residents associations fall outside all three purposes? If so, what are residents associations meant to be? 
The Minister keeps saying that he is trying to solve a particular problem, but changing the definition to include ''charitable . . . purpose'' does not alter a whole swathe of other concerns raised by hon. Members. I hope that he will refer to those concerns, too.

Richard Caborn: Whether or not the hon. Gentleman believes that his interpretation is correct, a distinction was made because residents associations were elected bodies. They, and other organisations, did not receive that lottery fund, and we believe that that was wrong. There could well be an argument about whether that was a correct interpretation of the Community Fund rules at the time, but I am saying what happened. We want to make sure that it does not happen again, and I believe that what we are putting into the Bill will make sure that it does not happen again.
I am sure that hon. Members agree that residents associations, and other organisations to which I have referred, ought to have access to that fund. There is no disagreement in the Committee; we are saying that, rightly or wrongly, the earlier definition was interpreted by the distributing body—the Community Fund—in a way that did not allow those bodies to receive that money. We are now trying to rectify that and make sure that the same thing does not happen in future. I am sure that, on that basis, the hon. Member for East Devon will withdraw his amendment. 
Mr. Turner rose—

Frank Cook: Do I assume that the Minister has completed his response?

Richard Caborn: I am doing my very best. I will allow an intervention.

Andrew Turner: I am grateful to the Minister for giving way. He has not referred at all to clause 19; nor has he given us the definitions that we asked for of ''benevolent'' and ''philanthropic''. Perhaps he is thinking about it before he answers. 
The Minister has just said that he is opening the door to organisations that we all agree should be included in the definition, and that he believes were not included previously. My point—perhaps I did not make it clearly enough—is that he is also opening the door to some organisations that many of us feel should not be included, such as the Conservative party or the anti-war coalition.

Richard Caborn: We do not give directions; that was a previous argument in Committee. We believe that directions need to be given, both at a high level and, based on the consultation, by the Big Lottery Fund. That fund will take heed of its own consultation, as well. The organisations to which the Big Lottery Fund will give grants and in which it will invest its money is a clearly defined area. That would be a judgment made by the Big Lottery Fund, not the Government. The high-level definitions that we give are based on our consultations. Further definitions have been given by the Big Lottery Fund, concerned with health, education and so on. We expect the Big Lottery Fund to give grants to and invest in bodies that are concerned with those areas.
The bottom line is how the Big Lottery Fund spends the money; that is more important than what the money is spent on. The fund is spending that money. We are talking about the organisations that that can be done through. That is what we are trying to sort out in the Bill, with regard to two things; the experience of the Big Lottery Fund and NOF, and what, after consultation, we broadly believe people want that money to be spent on. The two debates that we have had this morning are really about that. 
Some may argue that the Community Fund did not apply the full criteria in the right way, and that may be the case. All I would say is that our experience of how the Community Fund operated was that it led, rightly or wrongly, to some organisations that we believe benefit our communities not having access to that money; we are changing that.

Hugo Swire: When the Minister sat down earlier, I thought that he did so as an admission of defeat and exhaustion. However, he has come back fighting. Clearly, his experience on the Committee that considered the London Olympics Bill has served him well.
My hon. Friend the Member for Isle of Wight referred earlier to the Boer war, on which I am not an expert. However, for sheer effrontery there has been nothing like what the Government are doing since the early raids in the desert by the long range desert group, of which I am reminded this afternoon. We are clearly seeing what has been referred to as the Government's raid on the lottery beginning to unravel. The Minister used the phrase ''crystal clear''; what is crystal clear is that if we were not to press the amendment, we would enable the national lottery to fund anything by direction. That, of course, is the reason behind all this. 
The Minister is an honourable man. You will quickly correct me, Mr. Cook, and say that in this  Room we are all honourable men and ladies. Perhaps one day, over a drink in years to come, when the Minister has been promoted to the other place, we shall discuss this again. Sitting on the Terrace on a moonlit night, he may concede that it was at this stage that the national lottery ceased to be a quasi-independent operator and became effectively a Government Department. 
The Minister talked about the need for flexibility, which immediately sent a shudder down my spine; when, in a debate on a very important Bill, a Minister talks about the need for flexibility, he is suggesting that there could be a Pandora's box. The Minister also said that the Big Lottery Fund should have the flexibility if it judges that to be right; if that completely independent organisation judges it to be right.

Richard Caborn: Let me explain. On the one hand, the hon. Gentleman is saying, ''Don't give directions; we should leave it wide open''. We say, ''No, we want to give some directions because that represents the results of our consultation.'' Within the broad policy resulting from that consultation, we give a broad direction. There have been further consultations by the Big Lottery Fund, which has refined the issue and laid it out again. We will use secondary legislation, subject to a vote in the House, to define the issue further.
On the one hand, the hon. Gentleman argued that the BLF was too constrained, and on the other that it was not constrained enough, and that it could go as wide as it wanted, which is not true. The BLF will act within the constraints that Parliament has placed on it and will operate according to that direction. Within those constraints, I said that there would be flexibility.

Hugo Swire: Honeyed words indeed, but unfortunately clause 36E(1) of the Government's own Bill states:
''In exercising any of its functions the Big Lottery Fund shall comply with any direction given to it by the Secretary of State''.
We shall debate later just what the Big Lottery Fund is and just who is responsible for appointing it. I think that we shall find—lo and behold—that it will be the Secretary of State, so we are not reassured by that. This is another example of the Government's raid on the lottery. We shall resist it in the only way we can. Therefore, without further ado, I shall press the amendments to a Division. 
Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 9.

Question accordingly negatived.

Hugo Swire: I beg to move amendment No. 27, in clause 7, page 4, line 26, at end insert—
'(2A) After subsection (3) insert— 
''(3A) Not less than 70 per cent. of the sum allocated under subsection (3)(d) shall be allocated to bodies (other than public bodies or local authorities) whose activities are carried on not for profit.''.'.

Frank Cook: With this it will be convenient to discuss the following amendments:
No. 28, in clause 7, page 5, line 3, at end insert— 
'(da) persons that the Secretary of State considers to be representative of bodies (other than public or local authorities) whose activities are not carried on for profit,'. 
No. 94, in schedule 2, page 22, line 17, after 'records,', insert 
'which shall include information regarding the percentage of funds allocated to bodies (other than public or local authorities) whose activities are not carried on for profit,'. 
No. 95, in schedule 2, page 22, line 18, at end insert 
'and 
(c) prepare a statement in respect of each financial year detailing the sums allocated or loaned to charities or other institutions established for charitable, benevolent or philanthropic purposes.'. 
No. 38, in clause 14, page 7, line 27, at end insert— 
'(da) bodies (other than public or local authorities) whose activities are not carried on for profit,'. 
No. 42, in clause 14, page 7, line 38, after '(1)', insert 
'to bodies (other than public bodies or local authorities) whose activities are carried on not for profit,'. 
No. 61, in clause 14, page 9, line 8, leave out 'and'. 
No. 62, in clause 14, page 9, line 9, at end insert— 
'(e) bodies (other than public or local authorities) whose activities are not carried on for profit, and 
(f) the public by means of publication of the proposals for the direction.'. 
No. 63, in clause 14, page 9, line 13, at end insert— 
'(b) bodies (other than public or local authorities) whose activities are not carried on for profit, and 
(c) the public by means of publication of the proposals for the direction.'.

Hugo Swire: Although my name is attached to amendment No. 27, I hope that at some stage the hon. Member for Bath will join in our deliberations; perhaps he will do so on this group of amendments.
This rather large group of amendments form another area of significant difference between us—I hope that that means Her Majesty's Opposition and the Liberal Democrats—and the Government. It concerns not only the powers of the Secretary of State over the Big Lottery Fund, but the exact degree to which the fund's expenditure should be charitable. 
We have discussed my amendment to make all Big Lottery Fund expenditure charitable and we voted on that. I hope that we are now in more agreeable territory because, according to the Minister's previous statement, there is clear agreement on how much Big Lottery Fund expenditure should be charitable. 
On Second Reading back in June, the Minister said that 
''between 60 and 70 per cent. of the Big Lottery Fund's income will go to communities or charities.''—[Official Report, 14 June 2005; Vol. 435, c. 175.]
Disagreements over the exact definition of charitable expenditure aside, I have a simple proposition for the Minister that would allow us to withdraw the amendment. Amendment No. 27 would simply take the commitment that the Minister made verbally in the House and other places and put it in the Bill. That having been his stated position, I do not see how he can now argue against it. If he does, he will only serve to confirm suspicions throughout the charitable sector that were aroused by his comments a few moments ago that his commitment will remain, at best, a vague one. The amendment, not surprisingly, has the strong support of the voluntary sector. 
The Minister will say—indeed, he has said so—that it is adequate for him to put his commitment on the record. I fundamentally disagree with that. His commitment, if it is a commitment, must be enshrined in law if it is to be meaningful and lasting. He may, for example, find himself in a different position in the Government, even out of Government or in that other place to which I alluded earlier and be replaced by a Minister who did not make that verbal commitment. Who would then be accountable and who would ensure that the current Minister's commitment of 60 to 70 per cent. was reached? It is true that the commitment has also been made by the Big Lottery Fund board, but, technically, that is just the board and it is due to be replaced by 2009. 
Not only should the commitment be in the Bill, there should also be a legislative framework for Parliament—not the Secretary of State—and the public to check that it is being met. That is why the amendments No. 94 and 95 would require the Big Lottery Fund to make clear how that 70 per cent. target is achieved. There is no need to miss those targets or to say that things did not happen in some way, because we propose that there will be an statement of accounts at each financial year. Amendment No. 95 states: 
''prepare a statement in respect of each financial year detailing the sums allocated or loaned to charities or other institutions established for charitable, benevolent or philanthropic purposes.'.''
That is how we would ensure that the Minister's stated commitment, which we now want in the Bill, will be met under amendments Nos. 94 and 95.

Tom Harris: At the risk of going over previous discussions, the hon. Gentleman seems once again to be contradicting his own arguments. Does he believe that the Government are being too prescriptive or not prescriptive enough? The amendment that we are discussing is extremely prescriptive. That is exactly the criticism that he made of the Government in an earlier debate.

Hugo Swire: I think that the hon. Gentleman wants to row back. We do not like the Bill at all. We do not like the way that the national lottery is being hijacked by the Government, nor the way in which the funds are being diverted to fund what we believe should be core Government expenditure. That is an argument in relation to additionality. 
All I am seeking to do, on behalf of the voluntary sector, is to ensure that if the Government are to get their hands on 50 per cent. of lottery spend, which is hundreds of millions of pounds a year, and if, through the Secretary of State and the Big Lottery Fund board, they are to give themselves powers to use that money pretty much where they deem fit, we should at least have a guarantee that 70 per cent. of that money will be reserved for charitable expenditure. If the hon. Member for Glasgow, South has a problem with that, he should say so. He should not blame the Opposition. We do not want it in the first place. 
The figure in the amendment applies either to registered charities or to charitable and voluntary groups that are not registered charities, but it excludes public bodies.

Adrian Bailey: I rise to pursue the line of the hon. Gentleman's response to my hon. Friend the Member for Glasgow, South. The hon. Gentleman said that the money should be prescribed for bodies for charitable purpose. With respect, that is not incorporated in the amendment, which says
''whose activities are carried on not for profit''.

Hugo Swire: Perhaps the hon. Gentleman will allow me to finish. If he feels that I have not answered his question by the end, I am more than happy to return to that.
Further to our wish to see a guaranteed proportion of lottery funds go to the voluntary sector, as has been a founding principle of the lottery since its inception, we also feel that the voluntary sector is not included enough in the Secretary of State's powers of discretion. Amendments Nos. 28, 38 and 61 to 63 would ensure that the voluntary sector is consulted by the Secretary of State when issuing directions concerning expenditure to the Big Lottery Fund. Such amendments would enshrine the status of the voluntary and community sector as key stakeholders—to use the Government's favourite phrase—in the national lottery. 
The case for such consultation is made all the more pressing by the poor consultation record to date of the DCMS. I regret that for a Department so proud of its record of consultation on the lottery—we have heard a lot about that this morning and I suspect that we will do so again this afternoon—it has attracted so much scorn on its consultation record on the lottery. The National Council for Voluntary Organisations concludes that 
''the Department for Culture, Media and Sport . . . and its affiliates have frequently ignored or overlooked''
agreements on consultation between the DCMS and the voluntary and community sectors. 
The NCVO goes on to give a specific example: 
''A series of failures over an 18 month period by the DCMS to consult with the voluntary sector in a meaningful or clear way in regards to the proposed merger of the Community Fund and NOF. (On multiple occasions during this period there were breaches of the Consultation Code.)''
That is just one reason why the amendments to enshrine the Secretary of State's duty to consult the voluntary and community sectors on Big Lottery Fund funding is so important. 
The Minister is fond of saying that the Bill responds to exactly what the public want. He has done so on a number of occasions this morning. Since its consultation process has been so flawed, I cannot see that that is the case. Of the list of respondents to the first round of lottery consultation, I could identify just three people who could be classed as ordinary members of the public.

Jo Swinson: My hon. Friend the Member for Bath and I support the amendment and the general vein of the discussion so far about the importance of preserving the independence of the lottery distributors and the importance of the voluntary and community sector. I am sure that we have all seen lottery distributors' lists of the voluntary and community sector bodies in our own constituencies that have benefited from national lottery funding, and that we all rejoice when that happens and when we see the impact of such funding in our area. It is only sensible, as those bodies are to be the beneficiaries of such funding, that they have a say in how it is distributed and that the organisations that represent them have a right to be consulted. Given the comments of the hon. Member for East Devon about the shortcomings of previous consultations, enshrining consultation in the law is important, and various amendments deal with that.
Amendment No. 27 is the key to this group, which basically asks again for the commitment that has already been made that 60 to 70 per cent. of the funding will go to the voluntary and community sector. The Big Lottery Fund has already given that commitment, and the Minister gave it on Second Reading when he stated: 
''I give a guarantee that between 60 and 70 per cent. of the Big Lottery Fund's income will go to communities or charities.''—[Official Report, 14 June 2005; Vol. 435, c. 175.]

Tom Harris: On a slightly technical point, the figure quoted by my hon. Friend the Minister of between 60 and 70 per cent. is substantially different from 70 per cent. or more. Presumably, 60 to 70 per cent. means that 70 per cent. is the top level. The amendment specifically says that 70 per cent. would be the starting level. Those are two different things. The amendment does not replicate the commitment given by my hon. Friend.

Jo Swinson: Clearly, there is a difference between 60 and 70 per cent. A minimum of 70 per cent. would be a difference of 10 per cent.

Hugo Swire: Perhaps the hon. Lady is searching for the words in the amendment. It states:
''Not less than 70 per cent.'',
which does not suggest more than 70 per cent., but says what it says.

Jo Swinson: Indeed. I thank the hon. Gentleman for that intervention. We seek assurance from the Minister and, if he cannot give it, a good and sound reason as to  why the figure cannot be enshrined in the legislation. After all, he assured us on Second Reading that the voluntary and community sector would not lose out. He stated that
''some have said that a Big Lottery Fund could lead to voluntary and community sector organisations losing out. I can give a categorical assurance that that will not happen.''—[Official Report, 14 June 2005; Vol. 435, c. 170.]
How can such an assurance be given? The Big Lottery Fund has said that it would commit to 60 to 70 per cent. of the funding going to the voluntary and community sector—that is its current position. However, the board may change and take a different view after 2009. Indeed, the Minister may change, and he or she could take a different view. That is why the assurances being given now must be enshrined in law. We seek an assurance that the proportion of lottery funds going to the voluntary and community sector, not just the absolute amount of money, will not decrease. 
To pick up on the point about whether this group of amendments contradicts the earlier group, I believe that these amendments are entirely consistent with the argument for greater independence of lottery distributors. The Big Lottery Fund has agreed on a definition to be used in England, Scotland and Northern Ireland for the voluntary and community sector. The definition states that the sector consists of organisations whose defining features are 
''independence from the state, a motivation derived from values and social purposes rather than the pursuit of profit, and the re-investment of surpluses principally in pursuit of these values rather than for private distribution.''
The definition for Wales, which has been agreed with the National Assembly, is slightly different. 
The key words are ''independence from the state''. The definition also preserves the independence of lottery distributors, which should be enshrined in the Bill. As the Minister suggested that the changes that he is making are not intended to undermine us, I hope that he will be able to give us the assurances that we require.

Andrew Turner: I am disappointed that Labour Members are criticising the amendment when, if they had taken these proceedings and the Minister's undertakings seriously, they could have proposed an amendment to the amendment to align it exactly with what the Minister said. I can only assume they did not do that because they did not support the intention of the amendment or what the Minister said.
I find it extraordinary that what the Minister is actually saying is that at least 30 per cent.—and perhaps nearly 40 per cent.—of Big Lottery Fund Income will not go to communities or charities. That is the meaning of the words that appear in column 175 of the Second Reading debate; the Minister guaranteed that 
''between 60 and 70 per cent. of the''
Big Lottery Fund's income 
''will go to communities or charities.''—[Official Report, 14 June 2005; Vol. 435, c. 175.]
That is a huge amount of money which the Minister proposes should go neither to communities nor to  charities. I hope that the Minister will accept, if not the figure of 70 per cent., then at least the intention of the amendment, which is that the commitment he has made should be stated in the Bill. As my hon. Friend the Member for East Devon said, Ministers come and go, and Big Lottery Fund boards come and go, and Chancellors get itchy fingers and their powers of taxation diminish as the economy goes downhill and they always want a bit more. I suspect that unless this commitment is included in the Bill, when the Minister reaches the red-and-white striped tent along the Terrace—

Richard Caborn: They are Sheffield United's colours.

Andrew Turner: Well, that is the Minister's problem. When he reaches that tent, I suspect that he will regret not having included this in the Bill, because he will have seen his commitment undermined by the actions of his successors.

Richard Caborn: Mr. Cook, the only red-and-white terrace I shall be on is at the Sheffield United ground at Bramall lane; we are top of the Championship at the moment, 23 points ahead of Sheffield Wednesday—but that is totally irrelevant to our proceedings.
One of the allegations that has been made is that we and the voluntary sector do not consult. I am a little concerned about that because, as we have demonstrated in this Committee and in the Committee that considered the London Olympics Bill, my officials and I have been incredibly open. We have tried to be as helpful as possible in explaining what we are doing and why we are doing those things. We have given all the information available to us to the Committee, and to the voluntary sector. 
Indeed, we value that compact; I say that genuinely. I have met with the voluntary sector on a number of occasions, as have my officials. The NCVO has told us more than once that it thinks we could do better by meeting all its requirements in full. It is obvious that it should hold that opinion; everybody comes along with a shopping list, and if we do not accept everything on it, they think that is wrong. I understand that. However, we have shared all the information with the voluntary sector, and in particular the emerging plans as they have been prepared, in order to make sure that we were interfacing. 
Voluntary sector organisations might not agree with everything that we have said or that is in the Bill; far from it, and it would be stupid to think we could achieve that. However, the one thing I can say with certainty is that we have gone to great lengths to consult. In fact, at the last meeting I was at, people said they had consultation fatigue, because more of their time was being absorbed responding to our consultations than delivering services to the clientele of their charity. Consultation has taken up huge amounts of time. We have to strike a balance. 
I value the compact that we have. We must strike a balance so that we make sure both that we consult on matters and that we consult at the right time, so that others' views can be factored in to Government policy. That has happened, and it will continue to happen.

Hugo Swire: The Minister is right to defend his civil servants and his Department. That is one of his jobs as a Minister. What is his reaction to the quote that I came up with from the NCVO, which clearly conflicts with what he has just said? It referred to
''A series of failures over an 18 month period by the DCMS to consult with the voluntary sector in a meaningful or clear way in regards to the proposed merger of the Community Fund and NOF.''

Richard Caborn: I want the allegation to be specific. I put it on the record—on behalf of my officials, too—that we shared the information, first on the options set out in our emerging plans. When we had prepared the plans, there was further consultation, after which we had subsequent consultations. I am not saying that we accepted all its shopping list. That is different, but I want the NCVO to put on the record when I, my officials or former Ministers in my Department were not available for consultations.
The hon. Gentleman might look to the back of the Room, but I want the NCVO to put such details on the record, and against that I shall put the record of our consultations, our telephone calls and our sharing of our emerging ideas and plans. If the hon. Gentleman gives me the NCVO's shopping list on consultation, I shall match it and tell him exactly what we did and explain offers that we made—not only to one organisation but to all the organisations.

Hugo Swire: I am grateful to the Minister. I have just had a little inspiration. I think that the NCVO has already published its worries about the matter and I am sure that it is available. During the break before our next sitting, we shall make it available to the Minister. I say ''we'', but, of course, I am not a spokesman for the NCVO.

Richard Caborn: I can only say that the hon. Gentleman has not done a bad job.
In one way or another, the amendments are all concerned with the Big Lottery Fund and the voluntary and community sector. Amendments Nos. 27, 94 and 95 are concerned with the Big Lottery Fund's undertaking that between 60 and 70 per cent. of its funding will go directly to voluntary and community sector organisations. Amendment No. 27 would insert a new subsection into section 22 of the National Lottery etc. Act 1993 that requires the Big Lottery Fund to allocate 70 per cent. of its funding to bodies—other than public bodies or local authorities—whose activities are not carried out for profit. 
Amendment No. 94 would insert new wording into new schedule 4A of the 1993 Act requiring the Big Lottery Fund to keep, as part of its accounting record, information about the percentage of the funds allocated to those bodies. Amendment No. 95 would insert new wording into new schedule 4A to the 1993 Act requiring the fund, as part of its statement of accounts, to prepare a statement for each financial year. That statement would detail the sums allocated or loaned to charities or other institutions established for charitable, benevolent or philanthropic purposes. 
I reassure hon. Members that they need not be worried about the loss of the separate charitable good cause. Voluntary and community sector organisations  will not lose out. We all acknowledge that such organisations play a vital role in our society and provide a lifeline for many people who are sometimes in desperate need. That is why the Big Lottery Fund has already given an undertaking that 60 to 70 per cent. of its funding will go directly to voluntary and community sector organisations. That is a significantly higher proportion than has been the case under the New Opportunities Fund and the Community Fund combined. As that undertaking has been given by the boards of the Community Fund and the New Opportunity Fund, not the Government, it would not be appropriate to enshrine it in the Bill, although as I clearly said on Second Reading, we support the approach of the boards. 
The Big Lottery Fund has worked closely with the voluntary and community sector stakeholders to discuss and develop the definition of voluntary and community sector organisations for the purposes of the 60 to 70 per cent. undertaking and the plans for monitoring it. The fund will audit the undertaking as part of its internal audit processes. In addition, it will ask independent auditors to monitor where its funding has been going and the results will be published in the fund's annual report. That will be deposited in both Houses of Parliament. It will be open to public scrutiny. If members of the Opposition want to use their days to discuss it or force debates on the Floor of the House on the matter, they are entitled to do so. If the Select Committee wants to scrutinise the report, it has the power to do so. 
As I said, the independent, audited report will be placed in Parliament. A separate and more user-friendly document will also be published outlining the fund's progress against the undertaking on a country and UK-wide basis. 
I believe that the fund's actions show its full commitment to delivering on the undertaking and to doing so in a transparent and accountable way. That has not been the case before, either in relation to the House or the general public, where its accounts have not been opened up. Indeed, in my office, Stephen Dunmore told the voluntary services that he is going to try to put information into the public domain. I hope that in light of that the hon. Gentleman will not press his amendment to a vote.

Don Foster: The Minister suggested that he would tell the Committee why he is not willing to place a figure between 60 and 70 per cent. in the Bill. We still have not heard why that figure cannot be included.

Richard Caborn: It is not for the Government to decide whether it is 60 or 70 per cent.; it is a decision for the Big Lottery Fund. We do not believe that it is necessary to include that in the Bill. The hon. Gentleman has seen enough in this place to know that when a figure is put in the Bill it is set in stone. [Interruption.] Either we accept the integrity of people who are serving or we do not. I must admit that I am a little dismayed at the way that the hon. Member for East Devon impugns the integrity of people who serve on the Community Fund, the NOF and what will be the Big Lottery Fund.

Hugo Swire: That is disingenuous.

Richard Caborn: It might seem disingenuous, but the hon. Gentleman should refer back to what he said previously about people who will be nominated by Government and the Secretary of State. He then starts impugning the integrity of people who give up their time to serve on those bodies.

Hugo Swire: The Minister must give way at that point. It is a direct accusation.

Richard Caborn: I will give way when I want to give way, and it will be after I have finished. I feel very strongly about this. Although the Secretary of State may appoint, it is done in accordance with Nolan in a very transparent way. People who put their names forward for public service in this way need to be protected. The fact that it happens to be the Secretary of State who appoints them to the Big Lottery Fund does not mean that they act in concert with the Government. We in Parliament are laying out the directions for the Big Lottery Fund to operate. That is the way in which we approached that matter. The hon. Gentleman may argue with me, but I am just saying that he should not impugn the integrity of people who work in public service.

Hugo Swire: I really do not need lessons from the Minister on this. It is absolutely ridiculous. At no stage during any of our deliberations have I impugned the reputation of his officials or, indeed, the Secretary of State. If the Minister can only hide behind those rather lacklustre accusations, I suggest that there is something about the Bill he is trying to hide.
If the Minister would return for one moment to the amendment we are supposed to be debating, he will find that he has not provided an answer. It is not my intention to withdraw it. He has given an undertaking; he is now saying that he did not give it, but that the Big Lottery Fund did. The Minister also gave an undertaking, which he will not include in the Bill. That is our charge. It stands and it has nothing to do with his reputation, that of his officials or anyone else. If he is asking the Opposition to take in good faith anything the Government say without a commitment, he can think again.

Richard Caborn: I rest on Hansard. When the hon. Gentleman reflects on what he said about the appointments to the Big Lottery Fund and what he said about the Secretary of State, we can come back to this point and if he wants to question me at that time, that is fine.

Don Foster: I am grateful for the answer that the Minister has given to the hon. Member for East Devon because it at least clears my name. I hope that the Minister will accept that I have on no occasion impugned the integrity of the Minister, the Secretary of State or Sir Clive Booth, who currently heads the Big Lottery Fund, in whom I have enormous confidence. He will do fantastic things with it.
The Minister just said, prior to his tirade to the hon. Gentleman, that the decision relating to 60 to 70 per cent. figure is for the Big Lottery Fund. Clearly, therefore, it is possible for the fund to change that decision. It is the will of some Committee members, if  not the Minister, to ensure that that decision is not changed. We want that figure to be included in the Bill to ensure that it will not be changed in the future. That would mean that if there was a need for a change at a later date, it would require a change to the legislation to achieve it—that, of course, is always possible. I hope that the Minister is absolutely clear: we want Parliament to decide the figure, not just the Big Lottery Fund, which could at a future date change its mind without the approval of Parliament.

Richard Caborn: Unfortunately, I cannot go down that road. I will reflect on Hansard when it is published and we will see what was said. I was not referring my remarks to the hon. Member for Bath.
Let us return to the issue of 60 or 70 per cent. We need to leave that flexibility for those who are making the decision. We do not believe the figure ought to be included in the Bill. I have given support to what the Community Fund, the New Opportunities Fund and the Big Lottery Fund have said. I made that clear on Second Reading. We believe that the matter is better left with those people who are going to carry things out. Given that different circumstances might arise, we believe that that is the right way in which to put the legislation on to the statute book. It does not tie down the fund. Within the constraints that we have laid down in terms of the broad policy and the further consultation, we believe that the Bill provides the flexibility for the Big Lottery Fund to act in that way. 
I understand the other argument, but I do not accept it. We believe that our approach is correct. I have said clearly that we support the Big Lottery Fund in its declared objectives. There will be scrutiny in a report in a way in which there has never been before. If the hon. Gentleman and his party want to raise the matter on the Floor of the House, they are entitled to. If the Select Committee wants to challenge the decision, it has every right to do so. We do not believe that it is necessary to enshrine the figure in the Bill.

Don Foster: I am grateful to the Minister. The Committee has heard where he is coming from. He is clearly not going to agree to the amendment. Given that he has said that any change should be based on the consultation that will take place, could he at least tell the Committee why he is not prepared to include among the list of bodies that will be consulted the very group about which we are talking? I hope at least he can acknowledge that that is crucial and accept that that is an omission.

Richard Caborn: I think that I ought to continue and explain the other amendments, because that will probably answer the points that the hon. Gentleman has raised.
Amendments Nos. 28 and 38 are concerned with the Secretary of State's order-making powers, set out in new section 22(3A) and inserted by clause 14. The two amendments would add to the list of people the Secretary of State must consult before making such orders 
''bodies (other than public or local authorities) whose activities are not carried on for profit''.
That is to say; the voluntary and community sector. Amendments Nos. 61, 62 and 63 would require statutory consultation with the sector and the public before directions about English devolved expenditure or financial directions are given under section 36E, inserted by clause 14. 
We certainly expect to consult widely with representatives of the voluntary and community sector—and, indeed, with others with an interest, such as local authorities and social enterprises—before making any order. Of course, we are already obliged to comply with the Cabinet Office guidance on consultations and with the requirements of the Compact code of practice, which I referred to earlier. We have shown our good faith in that regard in consulting recently on the interim order for the New Opportunities Fund. Indeed, as I said earlier, we have been accused of creating consultation fatigue. However, we require a degree of flexibility in our approach. There is a statutory requirement to consult the Big Lottery Fund and the devolved Administrations because, unlike representatives of the voluntary and community sector, they are directly affected. Our actions and the safeguards in the Bill provide a compelling assurance that there will be ample opportunity to consider and comment on the Big Lottery Fund orders. I therefore ask the hon. Member for East Devon to withdraw his amendment. 
New section 36C, which is inserted by clause 14, gives the Big Lottery Fund new powers to work as an agent distributing money for other public bodes, the Government or private foundations. There are a number of potential advantages of allowing the Big Lottery Fund to distribute non-lottery funds, consisting of both public and private charity money. It could streamline and simplify a range of funding, lead to further developments of specialisms, skills and knowledge, and reduce the costs of distribution and grant management because of economies of scale. 
Amendment No. 42 would constrain those new powers so that money could be distributed only to non-governmental, non-profit organisations. It is not a major activity for the fund to distribute non-lottery money to local authorities, but I ask a simple question. Why ban it? We shall not ban local authorities after 11 years from applying for lottery money, so why ban the fund from distributing non-lottery money to them? The fund must have flexibility to get involved where it thinks that it can add value, and the amendment removes that degree of flexibility. With that explanation, I ask the hon. Gentleman to withdraw the amendment.

Hugo Swire: This is a case of methinks the Minister doth protest too much. It will be interesting to read Hansard, and perhaps we can debate that at a later time. As I said to the Minister when he got a bit rattled, I have at no stage sought to impugn the reputation either of the Secretary of State, or of any of the Minister's officials. Instead, from memory I think that I said ''were there to be in future a less scrupulous Secretary of State''; Hansard will bear that out. 
The real question is about why the Minister reacted in that way. It can be only because what he now refers to as the support he gave to the BLF was not support but a verbal commitment. I hope that the hon. Member for Bath would agree. The Minister now seems to say that it is support. That seems to be a rather watered down version of a commitment. 
I welcome the remarks that the Minister made and the undertaking he gave about an independent, audited report. It goes some way to meeting our desire to see whether the percentage is being reached.

Don Foster: The Minister did not make that commitment; he merely informed the Committee that it is a commitment made by the Big Lottery Fund. Just as with the 60 or 70 per cent., which the Minister said could be changed, surely it would be better to have those commitments also in the Bill.

Hugo Swire: I stand corrected. If that is the case, I had misunderstood it, and the hon. Gentleman is right. It does not detract from the main point of this group of amendments, which is about putting the percentage in the Bill. I understand that to be the position of the Liberal Democrats as well.

Adam Afriyie: Perhaps my hon. Friend can clarify something for me. Could the Big Lottery Fund decide to spend all the money on public body financing?

Hugo Swire: Well, I suppose that there is nothing to stop the fund doing that if it meets the directives from the Secretary of State through the Big Lottery Fund board. However, the point is that if the Minister is so committed to and supportive of the aspiration for the percentage to be part of the Big Lottery Fund remit, I do not see why he has a problem with it being in the Bill, unless he feels that it will be binding. That is precisely what we are seeking to do, because we want the commitment to be an unshakeable, unwavering commitment in cement.

Andrew Turner: I am disappointed that ''I give a guarantee'' no longer appears to mean I give a guarantee. It means that the Big Lottery Fund has given a guarantee.

Richard Caborn: That's right.

Andrew Turner: The Minister says ''That's right''. ''I give a guarantee'' does not mean I give a guarantee, and the Minister says ''That's right''. Further, in what position is the Big Lottery Fund to give such a guarantee? The Big Lottery Fund does not exist in law; the members have not been appointed in law; the members may be different after the Bill is enacted from those who currently act in that capacity. On what is the Minister's so-called guarantee founded?

Hugo Swire: My hon. Friend needs to be careful of what he accuses the Minister, otherwise my hon. Friend will be accused of impugning the Minister's reputation.
Given the time, I have no further comment to make. We shall return to those arguments, but I am afraid that we are unable to comply with the Minister's wish to withdraw the amendment. I should therefore ask for a division. 
Question put, That the amendment be made:—
The Committee divided: Ayes 7, Noes 9.

Question accordingly negatived.

Frank Cook: I should advise the Committee that in my concern to avoid inhibiting debate and to allow its free flow, which has certainly taken place this morning, I am asking my Clerk to report to my co-Chairman my considered view that a stand part debate on clause 7 would be not only inappropriate but unnecessary.
It being after One o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order. 
Adjourned till this day at Four o'clock.